107 STAT. 422 PUBLIC LAW 103-66 —AUG. 10, 1993 26 USC 41 note. (c) EFFECTIVE DATE. —The amendments made by this section shall apply to taxable years beginning after December 31, 1993. Subpart B—Capital Gain Provisions SEC. 13113. 50-PERCENT EXCLUSION FOR GAIN FROM CERTAIN SMALL BUSINESS STOCK. (a) GENERAL RULE.— Part I of subchapter P of chapter 1 (relating to capital gains and losses) is amended by adding at the end thereof the following new section: 'SEC. 1202. 60 -PERCENT EXCLUSION FOR GAIN FROM CERTAIN SMALL BUSINESS STOCK. "(a) 50-PERCENT EXCLUSION.—In the case of a taxpayer other than a corporation, ^oss income shall not include 50 percent of any gain from the sale or exchange of qualified small business stock held for more than 5 years. " (b) PER-ISSUER LIMITATION ON TAXPAYER'S ELIGIBLE GAIN.— "(1) IN GENERAL. —I f the taxpayer has eligible gain for the taxable year from 1 or more dispositions of stock issued by any corporation, the aggregate amount of such gain from dispositions of stock issued by such corporation which may be taken into account under subsection (a) for the taxable year shall not exceed the greater of— "(A) $10,000,000 reduced by the aggregate amount of eligible gain taken into account by the taxpayer under subsection (a) for prior taxable years and attributable to dispositions of stock issued by such corporation, or "(B) 10 times the aggregate adjusted bases of qualified small business stock issued by such corporation and disposed of by the taxpayer during the taxable year. For purposes of subparagraph (B), the adjusted basis of any stock shall be determined without regard to any addition to bsisis after the date on which such stock was originally issued. "(2) ELIGIBLE GAIN.— For purposes of this subsection, the term 'eligible gain' means any gain from the sale or exchange of qualified small business stock held for more than 5 years. "(3) TREATMENT OF MARRIED INDIVIDUALS. — "(A) SEPARATE RETURNS.—In the case of a separate return by a married individual, paragraph (I)(A) shall be applied by substituting '$5,000,000' for '$10,000,000'. "(B) ALLOCATION OF EXCLUSION.—In the case of any joint return, the amount of gain taken into account under subsection (a) shall be allocated equally between the spouses for purposes of applying this subsection to subsequent taxable years.
- (C) MARITAL STATUS. — For purposes of this subsection,
marital status shall be determined under section 7703. "(c) QUALIFIED SMALL BUSINESS STOCK.— For purposes of this section— "(1) IN GENERAL.— Except as otherwise provided in this section, the term 'qualified small business stock' means any stock in a C corporation which is originally issued after the date of the enactment of the Revenue Reconciliation Act of 1993, if — "(A) as of the date of issuance, such corporation is a qualified small business, and
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